Union OKs pact with 4 NJ casinos, gets raises

Union OKs pact with 4 NJ casinos, gets raises

November 2nd, 2011by WAYNE PARRY, Associated Press
in News

ATLANTIC CITY, N.J. (AP) - Atlantic City casino workers successfully fought off a management demand that they take pay cuts and contribute for the first time to their health benefits and pension costs.

Members of Local 54 of the Unite-HERE casino union on Tuesday overwhelmingly approved a new three-year contract with Caesars Entertainment Inc., Atlantic City's largest casino owner with four of the city's 11 gambling halls. A union spokesman said 92 percent of those voting cast ballots in favor of the deal, but the tally was not made public.

The deal calls for union members to get a raise at least once during the three-year deal and raises the possibility of additional pay increases if the casinos' revenue increases by 10 percent in any of the three years. But the contract is remarkable for what it doesn't do: insist on steep pay and benefit reductions that all the casinos had been pushing in the midst of a nearly five-year revenue slump that soon will see Atlantic City surpassed by Pennsylvania as the country's second-largest gambling market after Las Vegas.

"Thirty-five years ago this week, the people of New Jersey voted to allow casino gaming because of the promise that casino jobs would be good jobs," said union president Bob McDevitt. "Caesars Entertainment has again demonstrated a commitment to working with Local 54 to ensure the promise is upheld."

Don Marrandino, eastern division president of Caesars Entertainment, said he is glad the contract is settled, adding both sides can now get back to business.

"It is now time to put all of our attention on providing an even higher level of customer service and commitment to our destination," he said.

The contract continues free health care for casino workers and their families and a pension plan paid for solely by the companies. It calls for an hourly raise of 25 cents for workers at the top of the salary scale in the second year of the deal; those paid according to a step scale will advance one step on that scale in the third year of the contract.

The contract also includes protections for workers displaced by the possible closing of a casino - a distinct possibility for some of the city's weaker properties.

Local 54 represents 14,000 service workers including beverage servers, room cleaners and other workers. It does not include dealers, who are represented at the four casinos by the United Auto Workers.

The contract includes several incentives for management as well. Union members will only get holiday pay if they actually work on a holiday, and overtime pay will not kick in until an employee works 10 hours instead of the current eight. The union is also giving back one week of vacation pay for workers who currently have earned more than one week a year.

The deal could become the basis for pacts with the other seven casinos. The union plans to shop it to other casinos in coming days and see if they are willing to adopt it as well.

But some of the other casinos have taken a harder line in talks, seeking even deeper concessions that Caesars had. Earlier this year, most of the casinos had proposed pay cuts of $3 an hour for a work force averaging $12 an hour. They also sought health care and pension contributions, and it remains to be seen if the other casinos will drop those demands and agree to the same terms as the four Caesars casinos.

"We have negotiations scheduled with Trump and Golden Nugget later this week, and we intend to ask if they are willing to recognize the importance of their employees the way Caesars did," McDevitt said. "We certainly hope that other employers step up to the plate."

The pact with Caesars Entertainment drastically reduces the likelihood of a strike that could have been disastrous for both sides given Atlantic City's current precarious state. The resort continues to deal with increasing competition in states all around it; last Friday a casino opened at the Aqueduct racetrack in New York City, cutting even further into Atlantic City's customer base.

Since the first Pennsylvania casino opened in 2006 (there are now 10), Atlantic City's casino revenues have fallen from $5.2 billion to $3.6 billion last year. A further decline is expected this year.